Correlation Between A Cap and Progressive Planet

Can any of the company-specific risk be diversified away by investing in both A Cap and Progressive Planet at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining A Cap and Progressive Planet into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between A Cap Energy Limited and Progressive Planet Solutions, you can compare the effects of market volatilities on A Cap and Progressive Planet and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in A Cap with a short position of Progressive Planet. Check out your portfolio center. Please also check ongoing floating volatility patterns of A Cap and Progressive Planet.

Diversification Opportunities for A Cap and Progressive Planet

0.0

Correlation Coefficient

A Cap  Progressive Planet

Pay attention - limited upside

The 3 months correlation between APCDF and Progressive is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding A Cap Energy Limited and Progressive Planet Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Progressive Planet and A Cap is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on A Cap Energy Limited are associated (or correlated) with Progressive Planet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Progressive Planet has no effect on the direction of A Cap i.e., A Cap and Progressive Planet go up and down completely randomly.

Pair Corralation between A Cap and Progressive Planet

Assuming the 90 days horizon A Cap Energy Limited is expected to generate 4.35 times more return on investment than Progressive Planet. However, A Cap is 4.35 times more volatile than Progressive Planet Solutions. It trades about 0.09 of its potential returns per unit of risk. Progressive Planet Solutions is currently generating about 0.0 per unit of risk. If you would invest  1.00  in A Cap Energy Limited on October 26, 2024 and sell it today you would earn a total of  1.60  from holding A Cap Energy Limited or generate 160.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	23.48%
Values	Daily Returns

A Cap Energy Limited  vs.  Progressive Planet Solutions

A Cap Energy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days A Cap Energy Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, A Cap is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Progressive Planet

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Progressive Planet Solutions are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Progressive Planet reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with A Cap and Progressive Planet

The main advantage of trading using opposite A Cap and Progressive Planet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if A Cap position performs unexpectedly, Progressive Planet can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Progressive Planet will offset losses from the drop in Progressive Planet's long position.

The idea behind A Cap Energy Limited and Progressive Planet Solutions pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.